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What rights an Employer has if employee leaves without notice?
Being a Micro IT Services exports company based in Ludhiana, Punjab. we are struggling with this issue. Request experts at NASSCOM community to advise on what rights we have against the employee who has left without notice & joined another company. Hope to have solution from NASSCOM Platform.
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Quick answer "None".
You can look at bringing civil action for breach of contract if you have signed a contract with him. But given the state of our judiciary and the long pending cases it is highly unlikely that you will be able to get a quick resolution.
suggested way forward would be to look at mitigating such risks by having team members working closely together, insisting on high quality documentation and most importantly trying to understand what really caused the situation to happen (uncompetitive pay, difficult working conditions, lack of maturity from the employee, etc).
Thanks very much for your reply.
We generally get 1 year agreement signed with our employees with clearly written statement of two months notice after completion of the Agreement Term if he does not want to continue. We have people who are with us from last 5, 4 and 5 years and we try to provide them with the best of work environment along with work time not stretching beyond 7 PM as they start at 10 Am ( unlike other companies where we learned developers stay till long for deliveries). Our Performance Appraisals are in place from the start and we give increments twice in a year compounding to a minimum growth of 25% and maximum 35%.
But it poise a hinderance in our growth as on an average 2 resources quit in a year without notice. If this will be the case then What is your suggestions or how Medium and Large companies manage this issue.
It will be highly appreciated.
Techies India Inc
Well if it is just 1 or 2 resources a year you should be counting yourself lucky. I understand you are a small company so 1 or 2 resources can hit you hard.
For medium and large companies there is usually a bench strength available to dip into and ramp up quickly. As I mentioned earlier you to mitigate the risk by ensuring that knowledge is shared among resources and a way to document the knowledge is created. This ensures that the impact is minimized when these things occur. There are instances where resources have to quit without notice for genuine reasons (health/injury/family related) and you do need to be prepared.
It is hard when people leave without serving notice - Couple of suggestions to handle this.
a) Do not give the relieving letter
b) When the reference check comes (and today for all mid-large organizations, 3 levels of reference checks are done), please mark as not eligible for rehire (which I presume will be true. You wouldnt want to rehire someone who is not reliable). And explain why.
This has a good deterrent factor among other employees. People leave for various reasons but leaving without proper notice and KT are marks of unprofessionalism.
Gayathri: Good inputs. How will you find out if manager is giving "will not rehire" as an answer out of his/her personal vengeance.
To all: What if the manager is not behaving professionally and politically forcing the team member to leave out of frustration?
Ami: I do not think NASSCOM platform can provide help in this matter (my personal opinion) . It is hard to judge who (employee, manager or employer) is at fault.
This is what we have done in our organization (we are still tiny - 40 growing to 60 by End of the year).
a) The "No Rehire" is given out only by Delivery head (in our org, the role is part of Sr management team). The expectation is that this is going to happen very few times in the organizatio
b) All the requests for reference get routed through HR. As long as the individual has had a proper and good exit (all you need is a simple form tracking this), then HR can respond back with information by themselves.
c) Anyone where there are issues / problems gets referred to the manager & delivery head (or designated person).
This reduces the chance of misuse. Also, as Ami asks, this is a specific case of leaving without notice which in any scenario is employee fault.
Thanks Very Much Gayathri for your inputs and Thank you Lakshman for sending in your suggestions.
I think the additional information will help you in analyzing the situation, We are a Small team of 13 which is Headed by the Co Founder as he has an experience of 9 years in this industry and worked on various projects in UK and Australia. I think you have to believe that here company has not expelled and no politics involved here.
My question is we are a small company with a growing size and hiring 5 New Resources a Quarter to match the demand for our clients Project development. We do sign a minimum commitment agreement that is for 1 year and the clause says Notice period of 2 months.
If he leaves without notice and join other company then what rights do we have against the employee and the company who may have kept him without seeing the documents required as they may be in deep need of the resource, or employee may have produced fake experience letter and relieving letter.
I would request Mr. Pillai to please analyze our situation as it is actually and advise out of your experience that what can we do in this situation, Do we have legal rights and if yes then how to proceed.
Ami: Please do not take " my additional questions" personally. The intention of my questions is to find out the loop hole in the system. Sorry for not mentioning that. It is a legal issue and the only sensible option available is to take him/her to the court.
Personally, I will try not to excercise this legal option as much as possible. Am not saying that this is the right way to do. My company is very tiny and we are a pure product company. This may not work for services company where you are answerable to your customer (every day). I will try my best to have a backup plan to fill the hole.
Believe me, most of the good and "productive" person will not do this. Only those irresponsible, lazy, greedy.... etc., might do it. Faster they leave your company the better for you.
My personal feeling and opinion is that if the person has decided to leave, it is hard to get any work out of that person.
Think about the other way ... Why would a person leave company without notice? Is it because the other employer is desparate to get them asap and forcing their candidate to come and join within few days. If this the case, the fault is with the hiring company.
Edited Tue, Apr 26, 2011 4:29 PM
If you ask me, i am also the same opinion that i should not go to courts and all that, the one who has left if left for our good. The only problem is our growing size where we have a lot of people joining us. If we do not penalize one co worker for breaching the agreement, it could be popular amongst the one who have joined us as a trainee and after they get hands on experience in training, they may think of changing the company for higher salaries around knowing that the Black and White paper is of no use.
We were a product company earlier with a strong market presence in UK & Australia, but after the major hit in Education Sector in 2009 we changed our outlook and started the bespoke development services. As a product company we always had a back up as the head of the team is from Top Management who has the ability to make the new hiring understand the product ins and out. Being a bespoke development company its hard to get the new hiring to the live project where the clients is billed on hourly basis.
I would definitely want to exercise my right to Sue to the ex Employee and the New Company if its Legal and written in the code ( i am researching on it and this post was actually to get an insight on legal advices ), so that it should be a Benchmark for me and other small sized companies like us, so the employees know what can happen if they Breach.
Thanks for your time.
If you are considering legal options it would be best to invest in the services of a lawyer. While we do have a fairly competent set of people in this forum I doubt if we have many people well versed with civil and contract law in this forum.
Legal options do not work out, as per the constitution you cannot have a bond to bind an employee in the first place. Secondly, its a sheer waste of time & money for both the employer & employee in this scenario. I also run a software product startup & am aware of the problems what the author of this blog is addressing. You can replace project guys trained on the big products but replacing a guy trained on your own product & technology can be a nightmare!!! Re-training has its own issues BUT the solution is simple, if people leave witout notice do not give them the releiving documents, almost all companies do a reference check these days, if they don't MY REQUEST to all employers is that do find time & do a thorough reference check, do not hire without papers & proper releiving docs. A refrence check process can be as simple as calling & checking up with the previous company. Need not be too long a process like the biggies follow. If all of us come together as a community & do not hire without proper releiving docs from the previous company even if we are in a desperate need to hire someone, automatically this problem will be resolved!!! Keeping our judiciary, the process, costs & its speed in mind its better to solve this problem OUT OF COURT u see :-) All the best!
Here are a couple of other solutions/options that you can look at:
1. Since you are giving handsome raises, modify the salary structure to fixed + variable (bonus) component where is bonus is paid 6/12 months based on performance. If an employee leaves, the bonus for the preceeding period will be paid only if they complete their notice period. This may cut down some zero notice behavior.
2. Create an incentive for handling notice period - offer to pay notice pay at higher rates. It may buy you some time.
3. Work with NASSCOM local office to collectively create a code of conduct with other companies. If employees are engaging in zero notice behavior, it may bite other smaller companies as well. If all companies agree to not hire without due relieving papers and notice completion, the issue can be addressed to some extent.
Hope this helps.
From the trail I understand that you have good systems in place in terms of Salary, employee relations etc.
You may also want to look at are the employees leaving the manager or the Company.
It may be also quite possible they are leaving the company for persuing some personal ambtitions - higher studies, higher salary etc. In which case you can create some employee development programs in place
Are these your high potential employees who are quitting. In which case apart from your fixed and variable pay structure. You can look at a retention bonus packager for x number of years.